EX-99.2 3 a04-9374_1ex99d2.htm EX-99.2

Exhibit 99.2

 

For further information, contact:

J. David Smith or R. Scott Vansant

770-449-7066

 

EURAMAX INTERNATIONAL, INC. REPORTS

SECOND QUARTER 2004 OPERATING RESULTS

 

Norcross, Georgia (August 5, 2004) – Euramax International, Inc. today reported operating earnings and net sales for the quarter ended June 25, 2004 of $31.5 million and $250.5 million, respectively.  Operating earnings and net sales for the six months ended June 25, 2004 were $45.0 million and $445.9 million.

 

Net sales for the second quarter and for the six months ended June 25, 2004 increased 30.7% and 32.0%, respectively, compared to comparable periods in 2003.  Increases in both periods were attributed to the Company’s acquisition of Berger Holdings in the fourth quarter of 2003, higher selling prices attributed to increases in raw material costs, and stronger demand in each of the company’s operating segments.

 

Earnings from operations in the second quarter increased to $31.5 million from $14.1 million in the second quarter of 2003.  Earnings from operations for the six months ended June 25, 2004 increased to $45.0 million from $23.3 million in the same period of 2003.  Operating earnings growth was generally attributed to sales volume growth, which improved operating efficiency.  Growth was also attributed to $4.0 million of expense recorded in the second quarter of 2003 related to the application of purchase method of accounting, resulting from the purchase and sale of approximately 55% of the company shares between two primary shareholders.  Higher aluminum and steel costs in 2004 were largely offset by higher selling prices on products manufactured from aluminum and steel.

 

Operating earnings from the Company’s European segments increased to $12.5 million in the quarter ended June 25, 2004 from $5.1 million in the same period of 2003.  This increase included approximately $0.9 million attributable to the strengthening of the Euro and Pound

 



 

Sterling against the U.S. Dollar.  Operating earnings from the Company’s U.S. segments increased to $19.0 million in the quarter ended June 25, 2004 from $9.0 million in the same period of 2003.  The majority of the increase in the U.S. came from the Building Materials segment which accounted for $6.4 million of the increase.  This improvement was attributed to higher sales to rural, industrial and architectural contractors and recreational vehicle OEM’s.  The balance of the increase in U.S. operating earnings came from the roof drainage segment and was attributed to the Company’s acquisition of Berger Holdings.

 

Commenting on results, Chairman and CEO J. David Smith said, “Unprecedented raw material cost increases in the face of tight supply conditions continued to be our primary challenge in the second quarter.  Despite these conditions, we were able to meet market demands which contributed to exceptional sales and earnings growth.  We expect tight supply conditions, and corresponding cost increases, to continue for the balance of the year.  These conditions are expected to bring operating margins under further pressure.”

 

Long-term debt at June 25, 2004 was $298.0 million and the Company had cash and equivalents of $35.8 million.  Also at quarter end, the Company had $49.5 million available and undrawn on its revolving credit facility.  Long-term debt increased from $224.3 million at December 26, 2003, due to seasonal working capital requirements and as a result of the Company’s repurchase of common stock held by Court Square Capital Limited for approximately $67.8 million.

 

Euramax is a leading international producer of aluminum, steel, vinyl and fiberglass products for original equipment manufacturers, distributors, contractors and home centers in North America and Western Europe.

 

Note regarding forward-looking statements:  Statements made by Euramax which are not historical facts are forward looking statements that involve risks and uncertainties.  Statements including the words “anticipate,” “expect,” “foresee,” “believe,” “feel,”  “intend” and similar words also indicate forward looking statements that involve risks and uncertainties.  Actual results could differ materially from those expressed or implied in forward looking statements.  Important factors that could cause financial performance to differ materially from past results and from those expressed or implied in this press release include, without limitation, the risks of doing business in multiple jurisdictions, the Company’s ability to service its substantial debt and to comply with the restrictive covenants contained in the agreements governing that debt, the impact of foreign currency exchange rates, particularly the Pound Sterling and the Euro, impact of environmental regulations, dependence on key personnel, risks of business acquisitions, availability and cost of raw materials, particularly steel and aluminum, and a variety of other factors.

 



 

For further information on these and other risks, see the “Risk Factors” section of the Company’s Report on Form 10-K for the year ended December 26, 2003.

 

Euramax International, Inc. and Subsidiaries

Condensed Consolidated Statements of Earnings

 

 

 

Successor

 

Predecessor

 

Successor

 

Thousands of U.S. Dollars

 

For the three
months ended
June 25, 2004

 

For the two
months ended
May 23, 2003

 

For the one
month ended
June 27, 2003

 

Net Sales

 

$

250,487

 

$

114,457

 

$

77,194

 

 

 

 

 

 

 

 

 

Cost and expenses:

 

 

 

 

 

 

 

Cost of goods sold

 

193,723

 

90,854

 

63,904

 

Selling and general

 

21,399

 

10,563

 

8,159

 

Depreciation and amortization

 

3,850

 

2,531

 

1,571

 

 

 

218,972

 

103,948

 

73,634

 

 

 

 

 

 

 

 

 

Earnings from operations

 

31,515

 

10,509

 

3,560

 

 

 

 

 

 

 

 

 

Interest expense, net

 

(6,022

)

(3,678

)

(1,843

)

Other income (expense), net

 

585

 

292

 

(26

)

 

 

 

 

 

 

 

 

Earnings before income taxes

 

26,078

 

7,123

 

1,691

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

9,319

 

2,673

 

562

 

 

 

 

 

 

 

 

 

Net earnings

 

$

16,759

 

$

4,450

 

$

1,129

 

 



 

 

 

Successor

 

Predecessor

 

Successor

 

Thousands of U.S. Dollars

 

For the six
months ended
June 25, 2004

 

For the five
months ended
May 23, 2003

 

For the one
months ended
June 27, 2003

 

Net Sales

 

$

445,890

 

$

260,615

 

$

77,194

 

 

 

 

 

 

 

 

 

Cost and expenses:

 

 

 

 

 

 

 

Cost of goods sold

 

350,606

 

208,420

 

63,904

 

Selling and general

 

41,275

 

26,153

 

8,159

 

Depreciation and amortization

 

8,965

 

6,276

 

1,571

 

 

 

400,846

 

240,849

 

73,634

 

 

 

 

 

 

 

 

 

Earnings from operations

 

45,044

 

19,766

 

3,560

 

 

 

 

 

 

 

 

 

Interest expense, net

 

(11,779

)

(9,126

)

(1,843

)

Other income (expense), net

 

1,356

 

506

 

(26

)

 

 

 

 

 

 

 

 

Earnings before income taxes

 

34,621

 

11,146

 

1,691

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

12,263

 

4,254

 

562

 

 

 

 

 

 

 

 

 

Net earnings

 

$

22,358

 

$

6,892

 

$

1,129

 

 



 

Euramax International, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

 

 

 

Successor

 

Thousands of U.S. Dollars

 

June 25, 2004

 

December 26, 2003

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and equivalents

 

$

35,802

 

$

48,227

 

Accounts receivable, net

 

151,061

 

121,689

 

Inventories

 

117,729

 

89,543

 

Other current assets

 

10,320

 

8,188

 

Total current assets

 

314,912

 

267,647

 

Property, plant and equipment, net

 

155,644

 

141,437

 

Goodwill, net

 

137,613

 

176,394

 

Intangible assets, net

 

45,930

 

2,492

 

Deferred income taxes

 

5,361

 

3,595

 

Other assets

 

15,735

 

17,264

 

 

 

$

675,195

 

$

608,829

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Cash overdrafts

 

$

2,285

 

$

436

 

Accounts payable

 

112,015

 

91,689

 

Accrued expenses and other current liabilities

 

61,081

 

51,239

 

Current maturities of long-term debt

 

8,769

 

7,487

 

Total current liabilities

 

184,150

 

150,851

 

Long-term debt, less current maturities

 

289,270

 

231,807

 

Deferred income taxes

 

51,630

 

29,282

 

Other liabilities

 

30,006

 

26,939

 

Total liabilities

 

555,056

 

438,879

 

Shareholders’ equity:

 

 

 

 

 

Common stock

 

500

 

500

 

Additional paid-in-capital

 

155,495

 

155,495

 

Treasury stock

 

(69,836

)

(1,964

)

Restricted stock grant

 

(2,999

)

(3,381

)

Retained earnings

 

37,114

 

14,756

 

Accumulated other comprehensive loss

 

(135

)

4,544

 

Total shareholders’ equity

 

120,139

 

169,950

 

 

 

$

675,195

 

$

608,829